- By Dan Browning
Jeff LeMaire was desperate for help five years ago when he signed his dad Marlyn into the Golden LivingCenter nursing home in Hopkins, Minn.
Marlyn LeMaire, 81 and a Korean War veteran, had dementia, heart disease, a colostomy, hearing loss and other ailments. His son — the primary caregiver — thought he’d found just the right place for his dad near his home.
But Jeff LeMaire says he didn’t understand at the time he filled out a thicket of papers to have his dad admitted to the nursing home that he was giving up his right to go to court if something bad happened. Among the forms he signed was an agreement to use binding arbitration to resolve any disputes the family might have with the home.
“That will be haunting me until the day I die,” LeMaire said.
Experiences like the LeMaires’ have led to a new push among legislators, state attorneys general and the public to change the way nursing homes present and use arbitration agreements.
A Proposed Change in Federal Regulations
Bad things did happen to Marlyn LeMaire, right from the start. He was rushed to the hospital three times in his first month at the residence. Each time the hospital discharged him, doctors gave instructions to nursing home staff to increase his fluid intake.
Jeff LeMaire says he didn’t understand ... that he was giving up his right to go to court if something bad happened.
The LeMaire family contends that the nursing home failed to ensure that he got enough fluids. Marlyn LeMaire rapidly lost weight and died of pneumonia complicated by severe dehydration just four months after his admission to the home.
Jeff LeMaire, his brother Charles, and sister Catherine Hajieck say they wanted to expose what took place in open court, but that they were blocked from doing so by a binding arbitration agreement that Jeff had signed when his father was admitted.
“Justice was clearly not served,” Charles LeMaire said.
The nursing home said in a court document that it gave LeMaire “conspicuous notice” of the arbitration agreement, which also stated that signing was not a condition of admission.
The Centers for Medicare and Medicaid Services (CMS) is weighing changes in the way binding arbitration agreements are presented when admitting people to nursing homes that accept federal payments.
The agency’s proposal, part of a much broader rule to reform long-term care, would require nursing home operators to explain arbitration clauses in plain language. They would have to tell incoming residents and their caregivers that the “alternative dispute resolution” agreements are voluntary and that they can’t be used as a bar to admission. Nursing homes would also have to point out that by signing such agreements, families are giving up their right to go to court.
States Want Some Agreements Banned
The CMS proposal does not go nearly far enough for 16 state attorneys general who recently signed a letter urging the agency to ban all arbitration agreements that are signed before a dispute arises. Arbitration can be a useful way to resolve disputes, they say, but only if both sides are on equal footing.
That’s just not the case for many families seeking nursing homes for their loved ones, said Minnesota Attorney General Lori Swanson, who was among those urging CMS to ban all pre-dispute arbitration agreements.
Swanson said the deck is stacked in the favor of the industry. And because arbitration results generally are not made public, she said, they have no precedential value in court and effectively prevent reforms that might follow significant awards from lawsuits.
The attorneys general note that financial awards resulting from arbitration tend to be lower than those resulting from court proceedings.
Aon Risk Solutions, a risk management and insurance company, conducted a study of nearly 1,500 long-term care provider claims in 2012 and found that those settled under “valid” alternative dispute resolution agreements were 21 percent cheaper than other claims. “Arbitration continues to be an effective cost limiting tool for long-term care providers,” the study said.
The company noted that Congress has considered legislation to modify arbitration rules each year since 2008 but so far, no laws have been enacted.
What Legislators and the Public Are Doing
“There absolutely has been a pushback” from the nursing home industry to thwart efforts to ban pre-dispute arbitration, Swanson said. She said any changes must take place at the national level because states are pre-empted by federal laws governing arbitration.
Sen. Al Franken (D-Minn.) led a previous failed effort to ban pre-dispute arbitration clauses in long-term care contracts. He said that while he would support a similar effort going forward, he believes that CMS rulemaking represents the best opportunity for change.
“All too often, only after a resident has suffered an injury or death do families truly understand the impact of the arbitration agreement they have already signed. I’m trying to fix this,” Franken said. “Last month, I pressed the Centers for Medicare and Medicaid to ban pre-dispute arbitration clauses in long-term care facility contracts. And to address the issue more broadly, I have a bill called the Arbitration Fairness Act, which would ban forced arbitration clauses in employment, consumer, civil rights and antitrust cases.”
Earlier this month, former U.S. Rep. Henry Waxman (D-Calif.) and representatives of AARP, Public Citizen and National Consumer Voice for Quality Long-Term Care joined a chorus of more than 50,000 people — including 34 Senators — who petitioned CMS to ban pre-dispute arbitration. Swanson said consumers who feel strongly about the matter should write to CMS and to their elected representatives.
Nursing Homes Want to Avoid ‘Lopsided Lawsuits’
The American Health Care Association (AHCA), the leading trade industry group, says CMS should leave things as they are.
“We feel that CMS lacks the Congressional-mandated authority to implement the rule, and federal law … supersedes any regulation,” said Greg Christ, an AHCA spokesman.
“We feel current law is sufficient, and gives individuals and families in our centers the protections they need under arbitration,” he said. “No one is saying it should be more difficult to go after nursing homes if a family needs to resolve a dispute. But let’s have a system that does so without the skewed approach that the trial bar brings through lopsided lawsuits.”
Jeff LeMaire says caregivers should simply avoid nursing homes that present binding arbitration agreements as part of the admissions process. He said it’s just too difficult to understand what you’re getting into when you’re under emotional duress.
“I’m handcuffed,” LeMaire said. “I can’t even talk about the specifics of what happened to my dad.” The family is subject to a gag order that was part of the binding arbitration process.
If avoiding a facility’s arbitration agreement isn’t possible, LeMaire said, don’t sign the agreement without consulting an attorney, loved ones and other trusted advisers first.